“Both had huge housing bubbles followed by dramatic crashes. But Spain is in crisis in a way Florida isn’t. Why?”

Because Florida residents could still rely on the U.S. federal government to continue to pay Social Security and Medicare, guarantee solvency of banks and provide help to the unemployed, he says. But Spain has none of that.

To solve their predicament, European leaders can decrease borrowing costs of southern European countries or help those countries export their way back to prosperity, Krugman writes. Yet eurozone elite seem reluctant to pursue the first option and completely unwilling to consider the second, which would mean higher inflation in Germany.

Draghi mentions having the central bank buy bonds of southern European countries to bring down their borrowing costs, yet German leaders seem dead set against that proposal.

The euro, Krugman writes, will only be saved if Germany accepts higher inflation, but German officials seem unwilling to even consider that proposal.

“Instead,” he says, “they’re still insisting, despite failure after failure — remember when Ireland was supposedly on the road to rapid recovery? — that everything will be fine if debtors just stick to their austerity programs.”

Even though the euro is defective, it should still be saved, Krugman argues.

“For failure of the euro wouldn’t just cause economic disruption; it would be a giant blow to the wider European project, which has brought peace and democracy to a continent with a tragic history.”

Draghi may understand the eurozone’s options and may understand that the euro is flawed, Krugman notes. The ECB president previously compared the euro to a bumblebee that can no longer fly and must graduate to a real bee.

The ECB is running out of options, according to Reuters, and it will either have to turn to options like buying government bonds that Germans oppose or offering cheap loans that increase its risks.

“It is very uncomfortable for markets knowing there is a risk there is no more they can do if data deteriorates in the next couple of months,” Nomura economist Jens Sondergaard told Reuters.